Downtown action

San Francisco developer plans major re-do for Exxon Mobil tower with possibletunnel expansion

Exxon Mobile tower in downtown Houston
Photo by WhisperToMe/Wiki
Shorenstein Properties received high marks for renovating a historic SanFrancisco building as headquarters for Twitter
MarketSquareSF.com

Shorenstein Properties, a prominent San Francisco-based developer, on Monday confirmed it has acquired the 45-story Exxon Mobil building in downtown Houston for a major redevelopment that may include linking the building into the downtown tunnel system.

Shorenstein recently received rave reviews for redeveloping a historic building in San Francisco for the headquarters of the Twitter company.

As part of the deal, Exxon Mobil agreed to lease back the entire building until 2015, when it will relocate its employees to its new corporate campus near The Woodlands.

The Exxon Mobil building, located at 800 Bell at Travis, was built in 1962 as the headquarters of Humble Oil & Refining, a predecessor to Exxon Mobil.

The sales price was not disclosed. As part of the deal, Exxon Mobil, the seller, agreed to lease back the entire building until 2015, when it will relocate its employees to its new corporate campus just south of The Woodlands.

The Exxon Mobil tower and its seven-story garage cover two downtown blocks. The 1.2 million square foot building is downgraded by real estate because it is not connected to the tunnel system that links many of the first-class office buildings and hotels in downtown Houston.

Although nothing is official yet, Shorenstein is expected to spend many millions to connect the building to the tunnel system, if possible, and make major upgrades to the office tower.

“We purchased this property markedly below current replacement cost, which gives us the opportunity, one the current user vacates, to employ all our company’s core skills in capital transaction execution, redevelopment, leasing and operations to increase the property’s value by establishing its long term position and further enhancing its reputation in the market,” Douglas Shorenstein, chairman and CEO of Shorenstein Properties said in a statement.

The price paid for the building was not disclosed, but people in the real estate community said it was around $50 million. By comparison, the Shell Plaza in downtown recently sold for around $550 million.

Shorenstein’s budget for renovating the property is expected to be significant because the company specializes in owning only prime “Class A” buildings and does not typically hold any dog-eared buildings in its portfolio.

Shorenstein owns dozens of office buildings across the nation including two others in Houston near the intersection of San Felipe and Loop 610: the 28-story Five Post Oak Park building, which is across the street from the St. Regis Hotel, as well as the 21-story 2000 West Loop South tower on the freeway’s west side frontage road.

The company’s founder, the late Walter Shorenstein, was a major supporter of the Democratic Party and was an advisor to presidents Lyndon Johnson, Jimmy Carter and Bill Clinton.

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bang for your buck

These are the 6 most affordable ZIP codes for Houston renters

Facebook / City of Bellaire, Texas

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Trying to afford buying a home in Houston is difficult enough with current mortgage rates, and doubly so if you're already paying high rent on an apartment or a house. But there are six Houston ZIP codes where renters can get the most bang for their buck, according to a new study by financial services company CashNetUSA.

To find the most affordable ZIP codes to rent in the U.S., analysts compared median household incomes by ZIP code to the average annual rent costs using the Zillow Observed Rent Index. ZIP codes where the average annual rental costs required the lowest percentage of median household income were considered the "most affordable."

Two Houston-area ZIP codes specifically stood out in CashNetUSA's ranking of the most affordable ZIP codes for renters in America: 77401 in Bellaire (No. 9) and 77094 in the Energy Corridor (No. 12).

According to the study's findings, the average monthly cost of a rental in Bellaire comes out to $2,401.25, and the median annual income of a Bellaire household is $210,577. Analysts then calculated that the annual rent of a home in the Bellaire ZIP code only takes up 13.68 percent of a household's median income, which is the ninth-lowest in the nation.

But as Houstonians know all too well, Bellaire residents aren't exactly struggling to pay their rent, seeing as they live in one of the wealthiest places in America.

Meanwhile in Houston's 77094 ZIP, annual rent costs only represent 13.88 percent of a household's median annual income. The area – which encompasses the Kingsland Estates, Green Trails, Green Trails Oaks, Windsor Park Estates, Windsor Park Lakes, and Barker neighborhoods – has a median household income of over $168,000, and average rent costs add up to $1,944.58, according to the study.

CashNetUSA found the No. 1 most affordable ZIP code for renters nationwide is 66224 in Leawood, Kansas, where annual rent only takes a 10.57 percent cut out of a household's median annual income.

Elsewhere in Texas, San Antonio's 78248 ZIP ranked as the No. 4 most affordable ZIP code for renters in the U.S., and the No. 1 most affordable ZIP code statewide. The North Texas ZIP code 75013 in Allen ranked two spots behind Houston to claim the No. 14 spot nationally.

The most affordable Houston ZIP codes for renters
CashNetUSA further unveiled the five most affordable ZIP codes across major U.S. cities, including in Houston, Austin, and San Antonio.

Following 77094 (which took the No. 1 spot citywide) is 77008 (No. 2), which spans Greater Heights, Houston Heights, Shady Acres, and Lazybrook/Timbergrove. Rent costs in this ZIP code averaged out to $1,856 per month, the report found.

Landing in the No. 3 spot is 77024, which includes four of Houston's historic Memorial Villages, including Hedwig, Bunker Hill, Hunters Creek, and Piney Point. The report said average rent in the area comes out to $1,730 per month, which takes up 16.88 percent of a household's median annual income.

The remaining top two most affordable ZIP codes for Houston renters are located in 77007 (Washington Avenue Coalition/Memorial Park, Rice Military, and Crestwood/Glen Cove) and 77345 in Kingwood, which is about 30 miles north of downtown Houston.